02/27/03

Bloomington, Ill. - State Farm Insurance Co., the nation's largest auto insurer, is mailing notices to its 40 million policyholders informing them they are not covered against nuclear blasts and radiation damage.

State Farm joined a host of companies in excluding nuclear-related auto claims amid heightened fear over terrorism.

State Farm, based in Bloomington, said nuclear blasts or radioactive damage are not normal road hazards and are not covered.

Spokesman Joe Johnson said the company reviewed policies in the wake of heightened awareness over terrorism and realized there was no specific language in the policies regarding nuclear-related claims.

"Basically, a nuclear event is the type of situation that could threaten an insurance company's solvency," he said.

Most insurers' auto and homeowners policies contain a similar exclusion, said Loretta Worters, spokeswoman for the Insurance Information Institute.

The nuclear exclusion will be added to automobile policies up for renewal beginning Dec. 1, and the language should be included in all State Farm auto policies by June 1, 2004.